Chapter 13 or Chapter 7? Take Your Pick Carefully

Like any other sensible person in Utah, you’d want to avoid bankruptcy as much as possible by spending wisely and settling your debts early. However, in case that you do get bankrupt despite everything, it will help if you know the difference between a Chapter 7 and a Chapter 13 bankruptcy. Choose which of these options you’ll take wisely, and paying for your debts and riding the road to recovery will be a lot simpler than you’d think. Of course, don’t forget to find reputable bankruptcy lawyers in Utah to help you out.

If your income is less than the median income of a typical household in the state, you can file for a Chapter 7 bankruptcy. This frees you from all debts by allowing your creditors to liquidate any of your assets as payment. However, some assets are considered exempted from debt, so it will help to have a lawyer who would know which of your items are exempted and which aren’t. On the flipside, you can only file for a Chapter 7 every eight years.

A Chapter 13 bankruptcy, meanwhile, will allow you to pay off your debts throughout a period of three to five years if your income is above the median income in Utah. People who lagged behind their mortgages or car loans can file for a Chapter 13 rather than a Chapter 7. None of your assets will be seized, although you will be forced to adopt a strict budget to pay for your debts.